18 March 2010

This also should be a headline, especially in the medical community, but for some reason is not.

Reform bill to increase Medicaid payments for primary care

The provision, would, over several years, bring Medicaid payments for primary care services up to the Medicare rate (which is itself too low but generally far outstrips the paltry remuneration offered by Medicaid). I was a bit unsure whether this provision had made it into the final bill, but the CBO score (Title I, Subtitle B, Sec 1202 for those keeping track at home) seems to imply that it did.

Why is this important? Well, first of all, the problems Medicaid patients experience regarding limited access to care have been well-reported and are linked to reimbursement levels for physicians. Which is not a surprise: when the overhead cost for an office visit (meaning rent, staff salaries, malpractice insurance) exceeds the reimbursement, the practice takes a net loss on each medicaid visit (and the physician is literally paying out of pocket for seeing the patient). So practices in state after state are either closing to new medicaid patients or refusing them entirely. If the compensation for at least some services rises to Medicare levels, more practices will open their doors to these patients.

In a way it is a pity that this is limited to primary care only, but I view this also as a first step. The need is certainly greatest in primary care, and I suspect and hope that this will in time be expanded to other specialties. The other thing that is good about this is that the cost differential will be borne by the feds (at least I think so -- anyone got a hard source on this point?) which is the first step towards federalization of the whole Medicaid program. It was a stupid and damaging accident of history that Medicaid wound up being state-administered while Medicare was national (if I recall correctly, it arose from the politics of race in the sixties, but I could be wrong). One of many problems about Medicaid is that the costs fall on the states' inelastic budgets hardest when states are experiencing the hardest economic conditions. States cannot run deficits, generally, and must balance their budgets every year. A recession produces huge shortfalls in revenue for the states, creating pressure to cut spending, while, at the exact same time, there are more unemployed and otherwise impoverished people signing up for Medicaid and increasing the costs. It's a Catch-22. If the program were federalized, excess costs from bad years could be rolled over into better economic times when enrollment wanes and revenues rise.

Additionally, fully federalizing Medicaid would allow for standard eligibility criteria (which currently vary wildly from state to state). The HCR bill does start this process with its expansion of eligibility to all people under a certain income level (100% FPL, I think). Currently Medicaid is in many states limited to the "deserving poor," meaning those with dependent children and those below some arbitrary level of income (in some states it's ridiculously restrictive). Again, the expansion is funded by the feds, I think at least in part or for a limited time.

Federalizing Medicaid would also allow streamlined enrollment. Many of the uninsured are without coverage even though they would be eligible for Medicaid. This is in part due to apathy or ignorance, I am sure, but also in part due to the fact that many states set onerous rules for applicants. Difficult requirements for documents, in-person interviews, and lengthy and oft-delayed review processes weed out many applicant who are dim, less-than-highly committed, or just disorganized. Whether this is by design, to limit enrollment and hence costs, or by accident, either way it prevents many folks who ought to have this coverage from getting it. A federal program would greatly increase access to eligible Americans.

Shadowfax

About me: I am an ER physician and administrator living in the Pacific Northwest. I live with my wife and four kids. Various other interests include Shorin-ryu karate, general aviation, Irish music, Apple computers, and progressive politics. My kids do their best to ensure that I have little time to pursue these hobbies.

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